Creditflux Newsletter

Today’s dealer auction to settle credit derivative trades referencing second-lien loans of Truvo (formerly World Directories) has returned a final price of 41.125. The result did not change from the initial market midpoint, as there were no requests for physical settlement from the eight dealers who took part. Inside market bids ranged between 37.625 (Commerzbank) and 41 (Merrill Lynch), while offers were between 41 (Goldman Sachs) and 45.5 (JP Morgan).

Separately, Truvo yesterday won US bankruptcy court-approval for its disclosure statement, with a plan confirmation scheduled for 6 October. Truvo’s unsecured creditors, including Alliance Bernstein, are fighting the plan, which would create four new entities and provide senior lenders with a combination of senior debt and senior equity. If they vote to accept the plan, senior note holders will receive cash and warrants, while PIK holders will receive a share of lender warrants.